The U. S. auto industry is in the worst shape it has ever been in. General Motors and Ford spend more on health insurance and pensions than they do buidling cars. It is, of course, the result of union demands that were regularly met for more than the last fifty years. It seems, in effect, as if GM and Ford are really in the health insurance business and only peripherally in the auto business. It’s no wonder that both companies will be forced to downsize and let Asian auto companies become the predominant manufacturers of cars in the U.S.
Investors are dumping their GM and Ford stocks and picking up Toyota and Honda stock. Toyota and Honda, operating in right-to-work states, will not only become the predominant U. S. auto companies, they will also become two of the largest employees in this country.
The future of the U. S. auto industry is, indeed, bleak. If GM and Ford survive, they will be much smaller companies with a fraction of the car-buying market. Their workers and unions will have only themselves to blame as Toyota, Honda, and Hyundai zoom ahead in high gear.
At this point, everyone has heard about the intention of Democrats to reward their union backers by passing the Employee Free Choice Act, which would permit unions to organize workers by simply getting them to sign so-called card checks and thus avoid secret-ballot elections.
There is a less well-known part of the proposed Employee Free Choice Act. It calls for the NLRB to seek a Federal Court injunction against any employer if that employer discharges or discriminates against employees during an organizing campaign or during a first contract negotiation. If an employee is discharged during such a period, the employer would have to pay three times the amount of lost back pay. Furthermore, if there are willful or repeated violations of employee rights during a first contract negotiation or organizing campaign, the employer could be fined $20,000 per violation, per employee.
It is apparent that the Democrats will eagerly pay the price demanded by unions for their support during the mid-term elections. Yet, the most severe price will be paid by Corporate America and their workers. As labor laws become more onerous, corporations will seek to move more of their operations to other lands. And when that happens, more workers will find themselves unemployed, and the ones to blame will be those whom they put in office.
The Supreme Court of the United States will hear a case about the First Amendment rights of unions to contribute funds to political candidates. The case will be heard on January 10.
Though the case is about Washington state law, the decision of the court will have national ramifications. If the Court rules against unions, it could make it difficult for unions to collect dues form both members and non-members.
If, however, the court issues a ruling on behalf of the unions, it could undermine regulations that ban unions from making contributions to political candidates.
The case is a dispute between the Washington state teachers union (the Washington Education Association) and a group of teachers who are not union members, but are nevertheless required to pay union dues. The non-union teachers claim that the union is using a portion of their collected funds to support political candidates whom the teachers do not support.
A Washington law states that unions can use funds from non-members for political purposes only with the expressed authorization of those non-members. The right to opt out of such arrangements was established by the Supreme Court in 1988. The non-union teachers claim they were never given an opportunity to opt out, and their dues were used without their consent. The union claims that by not stating a preference, the non-union teachers gave their consent.
The court will either rule that unions must receive direct approval from non-union employees before using those dues for political purposes, or it could rule that unions have a First Amendment right to use such dues.
If the Supreme Court rules in favor of the union, it could undermine long-established rules banning direct political contributions from organized labor. That would significantly hurt corporate America and strengthen a growing militancy amongst union officials and organizers.